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The Government of Lesotho together with African Development Bank (AfDB) on Friday signed a loan agreement of M151.76 million at the even held in Maseru.

Speaking at this occasion, the Minister of Finance, Mr. Tlohang Sekhamane said the loan is intended to finance Urban Distribution Rehabilitation and Transmission Expansion Project in Lesotho, saying the objective of the Project is to rehabilitate and refurbish electricity power distribution network across the country with the aim to improve availability and reliability of electricity to consumers. 

He remarked that energy remains one of Lesotho's priority sectors as it is crucial for growth and socio-economic development of the country. He said a large area of the country especially in the rural areas is not connected to electricity as a result this poses difficulties to the livelihoods of the people. 

He said the availability and reliability of the electricity power distribution will be realised through upgrading the power transmission line and rehabilitation of the distribution network from Quthing to Mohale's Hoek, Roma to Thaba-Tseka, Maseru, Teyateyaneng, Butha-Buthe and Lets'eng Diamond Mine in Mokhotlong.

Mr Sekhamane noted that the agreement marks an important milestone among a number of many projects from which Lesotho has continued to benefit through decades of partnership with the Bank. He acknowledged the Bank Group for continued support in funding the development programmes of the Government of Lesotho in different areas of the economy.

He said the government is fully committed to providing the necessary counterpart contribution to all projects signed to ensure their successful implementation, including taking over the recurrent related activities and costs upon their completion, further promising that they will also ensure that funds for all projects will be used effectively and efficiently towards positive change of the lives of Basotho.


He also pledged the Lesotho Government intensions to continue to work with the Bank in their collective development efforts to uplift the livelihoods of Basotho

Also speaking was the the Director General, Southern African Regional Development and Business Delivery Office, Dr Tonia Kandiero who said the Bank has approved the loan facility to assist the Government of Lesotho in the rehabilitation of 188kms of distribution lines and switching stations, expansion of the transmission network through upgrade of a substation and construction of 8km of transmission lines to support the government's national electricity access target of 50 percent by 2020.

She said the Project is expected to create 140 jobs during construction and make Lesotho less reliant on power imports adding that it will also facilitate the participation of private sector players in generation of renewable energy through the preparation of the 'Energy Resource Map and the Cost Service Study' which will recommend a sustainable tariff structure for the sector.

Dr Kandiero added that the intervention is complementary to the recently completed 'Lesotho Electricity Supply Project (2014)' which supported investment in the electricity supply infrastructure to enhance electricity access rate, ensure improved efficiency to reduce peaking shortages.

Furthermore, she noted that the project also compliments the Bank assistance to the 'Lesotho Electricity and Water Authority (2015), which developed a regulatory framework to facilitate private development of renewable energy generation.

She said the Bank is committed to working with the people and Government of Lesotho in the successful and swift implementation of the Project as they continue to jointly pursue other avenues to identify additional sources of funding and technical assistance for the energy sector in Lesotho.

Signatory to the agreement were Mr. Sekhamane who signed on behalf of the Government of Lesotho and Dr Kandiero signing on behalf of the African Development Bank.

The Government of Lesotho has reportedly received financial assistance from the AfDB since 1975 in a form of loans and grants, which financed Lesotho's development in various development areas such as roads infrastructure, water supply and sanitation as well as health services to mention a few.

Source: LENA 17/02/2017

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